Image Credits: CARLOS GARCIA RAWLINS/REUTERS
Venezuela is a land rich in oil and other natural resources, giving it a leg up in the business and trading world. In fact, it was even once the richest country in South America. Unfortunately, for the past 22 years, Venezuela has been in a steady decline. Oil demands have dropped and communists have influenced parties, seizing control of the once thriving nation.
Venezuela has been split into two main parties. Those known as “chavistas,” who were named after the previous socialist president Hugo Chavez. The other party consists of those who have been waiting over 18 years for the end of the United Socialist party.
Hugo Chavez died in 2013. His predecessor, Nicolas Maduro, was elected president on a promise to the people of Venezuela that he would continue Chavez’s policies.
On the contrary, by late 2014, oil money stopped flowing in.
Oil accounts for over 95% of Venezuela’s export revenue. When the oil prices dropped, the socialist government had to cut back on all of its social programs.
Having only one major export that was failing, meant that the Venezuelan economy took a huge hit. In January 2017, the Finance and Economic Development Commission of the National Assembly (AN), estimated that inflation in Venezuela would close out the year at 679.73 percent.
In addition to the flailing economy, the Venezuelan government has been issuing declarations to try to restore the economy. It’s been a poor and failed attempt. This has given us the situation in Venezuela today.
When the economy started to fail, the government tried to save it by taking some extreme, yet very socialist measures. The government attempted to redistribute the country’s wealth by taking over hundreds of private companies and thousands of acres of land. Venezuela implemented what is called the Fair Price Law, a law that heavily regulates the production, distribution and pricing of products coming in and out of the country.
As a result of the situation in Venezuela, many Venezuelans have turned to expensive imports or to the black market, simply to purchase essentials such as eggs, rice, and milk. Basic groceries are about five times the minimum wage. Tensions rose higher when the Venezuelan Supreme Court recently announced that it was going to take over the powers of the opposition controlled national assembly. This violation of the separation of powers drew thousands of people onto the streets in protest. Due to these demonstrations, the order was reversed only three days after being declared. The damage had been done. The little faith Venezuelans had in their government, was completely gone.
Since April, protesters have taken over the streets demanding not only international food aid, but an early presidential election. More than 90 people have been killed in the demonstrations. A local human rights group reported that there have been more than than 3,600 arrests.